Perception is reality
A lack of progress by U.S. lawmakers in budget and debt ceiling talks rattled investors on Monday, sending European shares to a four-month low and pushing the dollar and oil down.
U.S. stock index futures suggested Wall Street would also head lower later in the day after neither side in Congress offered any signs of a compromise over the weekend.
Trading remains relatively calm, suggesting confidence that a deal to end a partial government shutdown and raise the U.S. borrowing limit will emerge. But with only 10 days left to avoid a debt default, some investors are heading for the exit and few look to be making fresh bets.
“Until we get some sort of resolution, a lot of investors are standing back, keeping their money off the table just in case the unthinkable happens,” said Richard Hunter, head of equities at Hargreaves Lansdown.
“Just in case the unthinkable happens”
This is the setup for fear which leads to bank runs. In this case, perception will become reality.
It is already quietly becoming a reality…and quickly. presently, we are facing a “Matter of Moments” scenario, where any actual shock to the system could send it all over the cliff. That there are forces at work who want the crash, that is a very dangerous position to be in.
Of course, none of this guarantees a collapse… it just makes one painfully possible, and growing more likely, the longer we remain half-off the precipice.
Quote me on this; “Sooner or later reality takes over, right where probability said it would.”